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Customer Traffic Into the Red

Customer Traffic Into the Red

Stagnation just slid back into recession. After six years of 1% annual growth in customer counts and a flat first half of 2016, foodservice traffic declined by 1% in Q3, according The NPD Group. Even quick service, which has kept the overall industry from sinking farther in the past, saw a drop in traffic for […]

Burger Chains Keeping Prices in Check

Burger Chains Keeping Prices in Check

Burger King may have raised some eyebrows with the steep $5.99 price for the Bacon King burger it introduced yesterday. Is this a sign of escalating burger prices? Actually, it really isn’t. Although $5.99 is a premium price, it’s not Burger King’s highest. The record was last year’s A.1. Hearty Mozzarella Cheeseburger which went off […]

Are Price Hikes Killing Lunch?

Are Price Hikes Killing Lunch?

Menu-price increases are eating restaurants’ lunch. Data from The NPD Group find that lunch, which accounts for 33% of foodservice traffic, has been losing customers for two quarters. The damage to the business is largely self-inflicted: NPD says consumers are being priced out of lunch, especially in fast-casual concepts. For the quarter ended in June, […]

Wendy’s Ponders ‘Appropriate’ Pricing

Wendy’s Ponders ‘Appropriate’ Pricing

Emil Brolick, who retired as Wendy’s CEO in May, used to give wonderful, thoughtful mini-lectures on industry issues occasionally during earnings calls. In February, I called his report a “QSR Tutorial.” I’m pleased that his successor, Todd A. Penegor, is maintaining that style. Wendy’s Q2 reported included weak same-store sales—0.4%–but some gains, including a boost […]

Burger Deals Escalate; Is BK’s a Value?

Burger Deals Escalate; Is BK’s a Value?

Yesterday’s post spotlighted the accelerating discounting competition among burger chains. Burger King’s introduced a “2 for $10 Whopper Meal” deal and Sonic added a new $5 Boom Box meal bundle to compete with similar “value deals” from McDonald, Wendy’s, Carl’s Jr., Checkers and others. But yesterday had barely begun before several interesting reactions occurred. One […]

Steak ‘n Shake Freezes Menu Prices

Steak ‘n Shake Freezes Menu Prices

Steak ‘n Shake will announce today that it will not raise menu prices in 2016. The move comes as other chains have been hiking menu prices to cover rising labor and other operational costs, as well as to compensate for soft customer traffic. For example, Shake Shack this month took another menu price increase, following […]

Are Menu Prices Rising Too Fast?

Are Menu Prices Rising Too Fast?

Is menu-price inflation contributing to stagnant customer traffic? Several top chains have reported small same-store sales increases largely because of higher menu pricing that increases average checks enough to offset slight declines in customer traffic. That’s working now but higher labor costs and greater technology investments may push restaurants to further raise prices in 2016. […]

The QSR Burger Price Ceiling Rises to $6

The QSR Burger Price Ceiling Rises to $6

Carl’s Jr./Hardee’s introduction this week of their $5.59 Steakhouse Thickburger makes official the demise of $5 as the burger price ceiling above which quick-service chains fear customers will not go. So $6 is the new $5, and even that line already has been crossed at least one chain. In 2001, Carl’s Jr. introduced the “Six […]

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